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ONTARIO HORSE RACING Industry Information Meeting Country Heritage Park | Niagara Room Thursday, July 24, 2014. WELCOME. ONTARIO HORSE RACING Industry Information Meeting Country Heritage Park Thursday, July 24, 2014 AGENDA 1:00 Elmer Buchanan Welcome and Introductions

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Ontario horse racing industry information meeting country heritage park niagara room

ONTARIO HORSE RACING

Industry Information Meeting

Country Heritage Park | Niagara Room

Thursday, July 24, 2014


Welcome

WELCOME


Ontario horse racing industry information meeting country heritage park niagara room

ONTARIO HORSE RACING

Industry Information Meeting

Country Heritage Park

Thursday, July 24, 2014

AGENDA

1:00 Elmer Buchanan Welcome and Introductions

1:15 John SnobelenOHR Presentation: The Business of Horse Racing

2:00 Elmer Buchanan Industry Feedback

2:30 David Reimer Developing an Industry “IT Roadmap”


The business of racing

THE BUSINESS OF RACING

How Ontario’s Horse Racing Industry is Funded


Revenue

REVENUE


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

REVENUE

The revenue is driven by three main sources:

  • Commissions on Wagering*

  • Pari-Mutuel Tax Reduction*

  • Horse Racing Partnership Funding Program

*Based on an estimated $825M Ontario wagering


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

REVENUE


Commissions

COMMISSIONS


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

COMMISSIONS

The commissions earned from horseplayers provide

foundation funding for the industry.


Pari mutual tax reduction pmtr

PARI-MUTUAL TAX REDUCTION “PMTR”


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

PARI-MUTUEL TAX REDUCTION

PMTR is money that the industry receives from the reduction of the government’s share of the tax on wagering.

PMTR provides funding for a variety of industry initiatives.


Horse racing partnership funding program hrpfp

HORSE RACING PARTNERSHIP FUNDING PROGRAM“HRPFP”


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

A significant source of funds is the direct contribution to racing from the Ontario government.

These funds total $100 million per year.

The majority of the Partnership Funding is allocated to Purses.

$100,000,000


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

HORSE RACING PARTNERSHIP FUNDING PROGRAM


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

HORSE RACING PARTNERSHIP FUNDING PROGRAM


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

2013 OMAF Funding

Traditionally, funding for racing was split about 50/50 between operational funding and purses. In 2013 the temporary funding model put about $60 million into tracks allowing 100% of commissions to go to purses. Public funding of racetrack operations was a short-term solution due to its potential to reduce motivation to maintain and grow pari-mutuel wagering.

The long-term solution needed to accomplish two things; focus the entire industry on increasing commission revenue and provide certainty to horsepersons and breeders.


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

The mix of operational and purse funding is a crucial ingredient in the model.

The new model balances incentives to grow commissions, while providing horsepeople and breeders with certainty on race dates and purse levels.


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

Core Racetracks

Ajax Downs

Clinton Raceway

Flamboro Downs

Georgian Downs

Grand River Raceway

Hanover Raceway

Mohawk Racetrack

The Raceway at Western Fair District

Woodbine Racetrack


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

Core Racetracks

Ajax Downs *| Clinton | Flamboro | Georgian | Grand River | Hanover | Mohawk | Western Fair | Woodbine

Core racetracks collectively generate 92% of the wagering in Ontario.

They receive about 73% of partnership funding.

*While Ajax is a core track, it is funded out of FAR support.


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

Core Racetracks

Ajax Downs | Clinton | Flamboro | Georgian | Grand River | Hanover | Mohawk | Western Fair | Woodbine

In exchange for this funding the core tracks agree to guarantee 758 race days and over $121 million in purses.


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

Core Racetracks

Ajax Downs | Clinton | Flamboro | Georgian | Grand River | Hanover | Mohawk | Western Fair | Woodbine

The core racetracks accept the risk of generating increased revenue from wagering. This keeps the people with the most direct relationship with horseplayers, the tracks, focused on increasing the wagering on Ontario races.


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

Regional Racetracks

Dresden Raceway

Hiawatha Horse Park

Kawartha Downs

Lakeshore


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

Regional Racetracks

Dresden| Hiawatha | Kawartha | Lakeshore

Regional racetracks face a different challenge than Ontario’s core tracks. Regional tracks offer important grassroots racing opportunities but these races attract less wagering than the core product.

To support grassroots racing, the Partnership Plan provides funding with more flexibility. While core tracks can only use Partnership Plan funds for purses the regional tracks can use this funding for operations and purses. Hiawatha is utilizing existing purse underpayments prior to receiving purse funding.


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

Regional Racetracks

Dresden| Hiawatha | Kawartha | Lakeshore


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

“FAR” Racetracks

Fort Erie

Ajax Downs

Rideau Carleton Raceway


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

FAR Racetracks

Fort Erie| Ajax Downs | Rideau Carleton

  • Fort Erie Racetrack, Ajax Downs and Rideau Carleton Raceway are unique in the Ontario racing mix. Each offers racing that does not fit with the overall program:

  • Fort Erie offers Thoroughbred racing at a venue that does not receive OLG rent

  • Ajax is the only track that offers Quarter Horse racing

  • RCR offers a mix of Standardbred racing at a location that precludes regular interaction with core tracks.

  • To meet these needs, the Partnership Plan provides these tracks with operational and purse support geared to their unique needs.


Ontario horse racing industry information meeting country heritage park niagara room

THE BUSINESS OF RACING

FIVE-YEAR PARTNERSHIP FUNDING PROGRAM

FAR Racetracks

Fort Erie| Ajax Downs | Rideau Carleton


Ontario horse racing industry information meeting country heritage park niagara room

- END -

The Business of Racing

How Ontario’s Horse Racing Industry is Funded


Questions

Questions

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